Like the United States, Canada has subjected itself to an “increasingly uncomfortable reliance” on China for critical mineral supplies, but its wealth of metals and minerals beneath the country’s soil could, if properly harnessed, give Canada a significant strategic advantage in years to come, mining executives and experts recently told Canada’s House of Commons resource committee.
The hearings were held against the backdrop of deteriorating diplomatic relations between Canada and China over the detention of two Canadian citizens which has laid bare China’s willingness to “inflict economic pain by restricting Canadian exports,” writes Jesse Snyder for the National Post.
Pierre Gratton, head of Canada’s mining association, told policymakers:
“For decades, China has held monopoly-like control over critical minerals production and distribution, rendering the rest of the world reliant on procurement and creating a level of risk that deters investors from entering these markets.”
Gratton and others urged the creation of a “framework to develop and then protect Canadian supply chains for batteries and other products, and recommended the federal government establish a $250-million program over five years to incentivize investment in demonstration projects.” As China is increasingly demonstrating its willingness to play politics with its monopoly-like position in the critical minerals realm, experts also stressed the importance of strengthening ties with allies like Europe, the United States and Japan.
Having faced criticism over its handling of Chinese takeovers of Canadian natural resource assets, Industry Minister Francois-Phillipe Champagne updated the guidelines and lowered the threshold for a national security review for such procedures. The move followed the release of Canada’s first critical minerals list – a list of 31 metals and minerals deemed critical “for the sustainable economic success of Canada and our allies—minerals that can be produced in Canada, are essential to domestic industry and security and have the potential to support secure and resilient supply chains to meet global demand.”
Unlike its U.S. peer, Canada’s list, as we recently pointed out, acknowledges the importance of what we consider traditional mainstay metals like Copper, Nickel and Zinc — which, as followers of ARPN well know, are not only key components of 21st Century technology in their own right, but are also “gateway metals” that “unlock” a slew of other critical metals and minerals.
With the Biden Administration having made significant investments in EV battery technology a central piece of its infrastructure overhaul plan, relations with close allies are taking center stage. And with the U.S. and Canada having long shared a special relationship and integrated defense industrial base, it only comes naturally that our first look faces North, as the U.S. steps up efforts to diversify critical mineral supply sources and processing away from China. Recent meetings between U.S. Department of Commerce representatives and miners and battery manufacturers to discuss “ways to boost Canadian production of EV materials” point towards increased U.S.-Canadian cooperation, as do increased consultations between the two countries’ Geological Surveys.
For all of these reasons, we’ll keep tabs on resource-related developments in Ottawa and the buildout of the U.S.-Canadian integrated critical mineral supply chain as it begins to shape up, and will include examples from Canada in our forthcoming “Sustainably Greening the Future” roundups featuring mining companies’ efforts to “close the loop” and cut carbon emissions while supplying America’s mineral needs.
